591 Million Dogecoin (DOGE) Liquidated in 24 hours, What’s Happening?

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As an experienced analyst, I have seen my fair share of market volatility and liquidation events. The recent rout in Dogecoin (DOGE) has been particularly noteworthy, with over $60 million in total liquidations and a staggering 10.54% price drop to $0.12. This represents a significant shift for the meme coin, which has seen intense whale accumulation in recent times.

Over the past 24 hours, the market sell-off resulted in significant Dogecoin (DOGE) liquidations, marking one of the largest occurrences since May 2021. According to CoinGlass data, a total of $434.64 million in liquidations took place across the broader cryptocurrency market, with Dogecoin being notably affected.

Dogecoin’s historic liquidation

Due to being a meme cryptocurrency, investors often exercise caution with their investments in Dogecoin (DOGE) and related alternatives. However, the recent 10.54% plunge to $0.12 in its value has put long-term holders in a challenging predicament.

The market change resulted in a grand total of $60.86 million being liquidated, with long traders accounting for $60.23 million of that amount. This equates to approximately 507 billion DOGE tokens being wiped out. Whether this trend continues is uncertain, but the recorded data highlights the significant risk exposure of market players towards the meme currency.

As an analyst, I’ve observed a significant increase in confidence among futures traders regarding Dogecoin’s ability to recover its previous valuations. This optimism stems from the coin’s potential. Lately, there have been substantial purchases of large quantities of Dogecoin by whales – major investors or holders in the crypto market. These acquisitions initially helped mitigate the sell-off that ensued and resulted in a 22% decrease in value over the past month.

Bear slump is good

For traders who have been overexposed to Dogecoin and have suffered significant losses during the bearish slump, it may be disheartening at present. However, considering the larger context, this market downturn could actually prove beneficial for Dogecoin in the long run.

When the market is overheated and selling heavily, the Relative Strength Index (RSI) of DOGE has dropped to 28. After a prolonged period of decline, bears in the market might exhaust their supply of Dogecoin to sell. At this juncture, there could be a resurgence of buying interest, leading to a “buy the dip” trend as investors see DOGE as undervalued.

As a researcher studying the meme coin market, I would hypothesize that if certain circumstances unfold, the value of this particular coin in the spot market could bounce back and regain its position as the most capitalized meme coin among the top 10 cryptocurrencies.

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2024-06-18 17:50